Final date set to make claims against Solutia

By Jessica Centers
Star Staff Writer
10-14-2004

Anniston residents who believe they have a claim against Solutia for exposure to PCBs or any other contaminant must file a “proof of claim” by Nov. 30. Otherwise, they will “forever lose their rights” to recover on that claim. Across the country, Solutia is advertising in the cities where the company and its predecessor, Monsanto, have had plants and waste disposal facilities. The notice says people who think they’re owed money for something one of the companies did before December 2003 better speak now or forever hold their peace. The “bar date” comes as a result of Solutia’s bankruptcy filing on Dec. 17, 2003, and is normal bankruptcy procedure, said attorney Conor Reilly of Gibson, Dunn, and Crutcher LLP, which represents Solutia in its bankruptcy proceedings. For Anniston, the bar date could mark the beginning of the end of PCB litigation, at least as far as Solutia is concerned. “It will mean that any PCB-type claims in the Anniston area against Solutia will have to be resolved as part of our (bankruptcy) case,” Reilly said. From the 1930s to 1970s, Monsanto made polychlorinated biphenyls, or PCBs, at its Anniston plant. The chemicals contaminate local waterways, properties and the bodies of some residents. The chemical’s production was banned in 1977 because of health concerns. Solutia, which was spun off from Monsanto, inherited the chemical business from Monsanto along with the Anniston plant and liability for past chemical operations. The Anniston chemical operation has resulted in a handful of PCB lawsuits. The most notable were the state and federal suits settled together for $600 million in August 2003. “If you seek to assert any claims related to Monsanto’s historic chemical business … you must file a proof of claim by the bar date,” reads the notice that was ordered by the U.S. Bankruptcy Court, Southern District of New York. It also lists the materials made and used at the plant for people who may have an exposure claim. Plaintiffs in the Tolbert or Abernathy lawsuits do not need to file a claim, the notice says. Reilly said a reserve for valid claims against the company may be created and paid out after the company emerges from bankruptcy. If the claims are significant, however, they will have to be resolved before then. Reilly said he didn’t know if the bar date would dismiss any future claims against Monsanto for PCB contamination in Anniston. “It does bar against Solutia; it may or may not against Monsanto,” he said. Glynn Young, Monsanto’s director of environmental communications, said the bar date could not stop any future claims against any company other than Solutia. But he also argues that “new Monsanto” is not the same company as “old Monsanto”, nor should it be liable for its legacy. “In effect, we were just as much a spinoff as Solutia was,” he said. “We were the ag business.” He says a good case can be made that Solutia’s business is the business of “old Monsanto.” When Solutia spun off in 1999, it inherited Monsanto’s chemical business, along with responsibility for environmental contamination and healthcare benefits for thousands of retirees. Monsanto got the agriculture business. Then Monsanto in 2000 merged with Pharmacia and Upjohn Inc. to form Pharmacia Corp. The “new Monsanto,” a spinoff of the agrochemical and biotech seed division, emerged the next year and promised to accept liabilities that Solutia was unable to pay. In 2003, Pharmacia Corp. was acquired by Pfizer. Opinions differ on which company is liable for PCBs in Anniston. Dan Jenkins, a Solutia spokesman, said bankruptcy court will determine who pays for what going forward in terms of remediation and litigation in Anniston and elsewhere. Solutia is arguing that it should not be responsible for Monsanto’s liabilities and that it was also made to pay for retirement benefits of a disproportionate number of former Monsanto employees. Young said he doubts the bankruptcy proceedings will result in a final answer as to who is liable for old Monsanto’s environmental problems, but some agreement will have to be reached as to how cleanup and litigation are handled and paid for. Monsanto has been paying for Anniston’s PCB cleanup since Solutia went into bankruptcy. For more information regarding the bar date, call 866-378-1484.

About Jessica Centers

Jessica Centers, a University of Missouri graduate, covers business for The Anniston Star.